Pension bill awaiting Republican suggestions in Illinois House

Saturday

SPRINGFIELD -- A bill to increase what current public employees pay for their pensions stalled in the Illinois House last week, with resistance in both parties playing a role in the holdup.

SPRINGFIELD -- A bill to increase what current public employees pay for their pensions stalled in the Illinois House last week, with resistance in both parties playing a role in the holdup.

The measure, which still does not have finalized language with just over a week before the Illinois General Assembly is set to adjourn on May 31, could still be heard next week. The House Personnel and Pension Committee has scheduled committee hearings from Tuesday through Friday in case the legislative logjam can be broken.

“It’s Representative (Tom) Cross’ amendment,” said Rep. Kevin McCarthy, D-Orland Park, the chairman of the committee. “We’re ready to have the committee as soon as he’s ready to call the bill.”

Sara Wojcicki, a spokeswoman for Cross, the House Republican leader, declined Friday to answer questions about what kind of trouble the bill faced in Cross’ caucus, what changes members are suggesting and how much more current employees will be expected to pay for their benefits.

“This is a very complicated issue and we are working to finalize the bill,” Wojcicki said. “There are many issues still to be resolved in the next couple of weeks.”

But Rep. Rich Brauer, R-Petersburg, an opponent of charging more for benefits, said the bill faces serious problems among Republican members.

“I think Representative (Raymond) Poe had the best comment on that. He says, ‘If you don’t have any teachers in your district, then go ahead and vote for change,’” Brauer said. “To change somebody’s pension after they’re hired is wrong.”

State legislators are expected to have to pay significantly more for their pensions than other public employees, but McCarthy does not believe that is a factor in resistance to the bill.

McCarthy, who supports charging current workers more for pension benefits because of the precarious condition of the state’s retirement systems, which are owed $86 billion, said it will be a tough vote for most members. He does not believe the 60 votes needed for passage were there as of Friday.

“It’s a vote people hate to get out in front of … because it’s all a vote we wish we didn’t have to make,” McCarthy said.

”It’s a terrible thing,” he said. “No one likes to break promises, and I don’t like doing it, but some of us feel the systems are in the kind of shape that these extraordinary measures have to be taken.”

Chris Wetterich can be reached at (217) 788-1523.

What employees would pay

Most state, university, and school district employees and legislators would have to pay more in order to keep their current pension benefits, under pension legislation pending in the Illinois House, but judges would be excluded.

Teachers would contribute nearly 14 percent of their pay toward their pensions instead of the current 9.4 percent. Contributions for state employees and university workers not on Social Security are expected to rise to 13.5 percent and 15 percent, respectively, instead of the current 8 percent.

Those numbers could change as the bill is finalized.

Instead of paying more, current employees could opt for a second tier of benefits, the same package that was approved by the General Assembly last year for employees hired after Jan. 1. Tier 2 benefits are lower than those in Tier 1, and employees generally must work longer and retire later. Depending on the rate of inflation, Tier 2 also is likely to provide lower cost-of-living increases in workers’ pensions.

The other alternative would be to choose a new, third tier of benefits. In Tier 3, an employee’s benefits would be accumulated through a defined contribution plan – similar to a 401(k) plan — in which the state would contribute 6 percent of an employee’s salary and the employee would contribute 6 percent or more. Those funds would be invested for the employee’s retirement.

Unions consider the plan to be unconstitutional and plan to challenge it in court.

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